WILLIAM DONALD SCHAEFER, Governor                       Ch. 2

"special taxing district" are added to clarify the
broad scope of the reference to a "political
subdivision". Several provisions preempt imposition
of taxes where the State imposes a tax under this
article, but the former law referred generally to a
"political subdivision" or specifically to a "county,
municipal corporation, or other political
subdivision". In this article, each preemption
provision specifically enumerates "county, municipal
corporation, special taxing district, or other
political subdivision", to avoid the inference that
failure to mention a particular type of subdivision
allows that subdivision to impose a tax.

The second sentence of former Art. 81, § 323A, which
related to persons who may not be subjected to a tax
on income by a political subdivision, is deleted as
unnecessary in light of the use of the defined term
"county income tax", which applies only to an
individual.

Defined terms: "County" § 1-101

"County income tax" § 10-101 "Fiduciary" § 10-101

"Nonresident" § 10-101 "Resident" § 10-101

"State income tax" § 10-101 "Taxable year" § 10-101

"Wages" § 10-101

10-104. EXEMPTIONS.

THE INCOME TAX DOES NOT APPLY TO THE INCOME OF:

(1)  A COMMON TRUST FUND, AS DEFINED IN § 3-501(B) OF
THE FINANCIAL INSTITUTIONS ARTICLE;

(2)  EXCEPT AS PROVIDED IN § 10-304(2) OF THIS TITLE,
AN ORGANIZATION THAT IS EXEMPT FROM TAXATION UNDER § 501 OF THE
INTERNAL REVENUE CODE;

(3)  THE DEVELOPMENT CREDIT CORPORATION OF MARYLAND;

(4)  A FINANCIAL INSTITUTION THAT IS SUBJECT TO THE
FINANCIAL INSTITUTION FRANCHISE TAX;

(5)  AN INSURANCE COMPANY, WITHIN THE MEANING OF
ARTICLE 48A OF THE CODE;

(6) A PARTNERSHIP, AS DEFINED
INTERNAL REVENUE CODE; OR

IN

761 OF THE

(7) AN S CORPORATION.

REVISOR'S NOTE: Item (1) of this section is new language
derived without substantive change from the first
clause of former Art. 81, § 314(a).

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